Homebuyers continue to show strong demand and prove that there isn’t a summer slowdown despite the Covid-19 pandemic.
According to the National Association of Realtors, pending home sales, which measure signed contracts to purchase existing homes, increased 5.9% in July compared with June, and sales were 15.5% higher annually.
NAR’s Chief Economist Lawrence Yun said, “Home sellers are seeing their homes go under contract in record time, with nine new contracts for every 10 new listings.”
Yun does not expect sales to drop or become slower this fall season. He anticipates existing-home sales to reach 5.8 million in the second half of this year. This would then bring the full-year total to 5.4 million, showing a 1.1% increase compared with 2019.
Based on NAR’s index, the housing market activities from pent-up demand is in good shape. Pending home sales in the Northeast rose 25.2% for the month and were up 20.6% from a year ago. In the Midwest, sales rose 3.3% monthly and 15.4% annually. Sales in the South increased by 0.9% for the month and were up 14.9% from July 2019. Sales in the West rose 6.8% monthly and 13.2% annually.
“Anecdotally, Realtors are telling me there is no shortage of clients or home seekers, but that scarce inventory remains a problem,” Yun said. “If 20% more homes were on the market, we would have 20% more sales, because demand is that high.”
July sales of newly built homes, which are also measured by signed contracts, surged dramatically, as buyers are now looking for new, high-tech, smart homes with floor plans designed for working and schooling at home. Builders are also benefiting from the severe shortage of existing homes for sale.
Full article cnbc.com